Forex traders should pause to remind themselves of the essence of their business. When you trade forex, you are only looking to profit from the change that routinely occurs in price. It is an ongoing process. The classic motto is to buy low and sell high.
Mr. Jordan Lindsey, the founder of JCL Capital, advances the thought that any forex trader can trade his or her way to a fortune. According to Mr. Lindsey, by compounding 7 percent returns each month a $1,000 trading account would swell to over a million Dollars in only ten years. The math is correct, but the path to the objective takes discipline and the ability to make knowledgeable trading decisions.
The price at which you execute your trades has more of a say in ones’ success or failure as a forex trader than any other factor. Continuously arriving too early or too late will spell disaster for your cause. You do not need to consult any of the useful indicators which are available with most broker software for free. A simple glance at any price chart plainly reveals the peaks and the valleys.
Awareness of support and resistance levels transposed onto these price charts is more than a clue as to where you need to be entering or exiting your positions. Bear in mind that everyone wanting to get in at the same time is what causes prices to rise. On the other hand, as the herd stampedes toward the exit, prices will fall. By developing a sense of the reflexiveness in the market, Jordan Lindsey’s 7 percent monthly return becomes doable.
Profitable traders look at plunges and spikes in the forex market as setups for future trades. What goes up must come down. Thereby producing an opportunity to go short. Likewise, when prices dive, the astute trader is preparing a long entry. The one thing you should avoid is entering in the middle. Such trades often do not offer enough value to justify the risk. To consistently produce profits each of your trades should provide more gain than what you stand to lose.
As Jordan Lindsey advises, having the mindset of a saver and an investor is imperative. That way of thinking will cause you to focus on price as a signal of opportunity. Whenever you can buy something and sell it for more than it cost, you have a business.